The Federal Trade Commission’s recent settlement with Express Scripts quickly became one of the most discussed developments in the PBM industry. While the headlines focused on insulin pricing, the broader conversation is about something larger: the future of PBM accountability.
The announcement itself is not brand new. What becomes important over the following weeks is understanding the broader implications. As the initial reaction settles, employers and advisors are left with more practical questions about what this means for their own plans. That is why we are addressing it now.
At US-Rx, we believe these developments deserve thoughtful analysis, not quick commentary. The details of the settlement matter, but so does the larger conversation it prompts about incentives, transparency, and alignment in pharmacy benefits.
For employers and advisors, this is worth paying attention to. Not because it is dramatic, but because it brings long-standing structural concerns into public view.
You can review the FTC’s official announcement here.
Understanding the Core Allegations
The settlement addressed allegations that Express Scripts favored higher-cost branded insulins over lower-cost alternatives when building its formularies. The concern was that rebate arrangements tied to list prices may have influenced those decisions. To understand
why this connects directly to the future of PBM accountability, it helps to look at how many traditional PBM contracts operate.
Manufacturers often pay rebates that are calculated as a percentage of a drug’s list price. Higher list prices can produce larger rebate checks. Depending on the structure of a contract, a PBM may retain a portion of the rebate or incorporate it into pricing guarantees.
Over time, this can create tension within the model. If revenue is connected to list price magnitude, higher-priced drugs may generate more income than lower-cost options. Patients with deductibles or coinsurance often pay cost-sharing based on the list price rather than the net price after rebates. Employers may see pharmacy spend increase even when reported rebate totals appear substantial.
For organizations evaluating alternatives, many look toward a transparent pass-through pharmacy structure that removes retained rebate economics and aligns incentives more directly with total cost reduction. The regulatory attention surrounding this case reflects growing concern that incentive design, not just isolated decisions, can influence cost trajectories.
Why This Could Influence the Broader Market
Large PBMs operate complex, vertically integrated models. Rebates are only one piece of the equation, but they have historically played a meaningful role in revenue generation. If rebate practices face tighter oversight, PBMs may adjust how they generate margin. Specialty pharmacy, mail order dispensing, and administrative fee structures already represent significant revenue channels. Greater scrutiny of rebate economics could increase focus on those areas.
For employers, the important point is this: understanding a PBM relationship requires looking at the entire economic model. If one source of revenue tightens, another may expand. Alignment depends on how the model is built from the start.
This is why many plan sponsors choose to formally evaluate their PBM contract and overall incentive alignment rather than focusing on a single pricing lever.
The Regulatory Environment Is Evolving
This settlement arrives during a period of sustained federal and state interest in PBM practices. Other large organizations remain under investigation, and legislative proposals continue to circulate.
Employers are also more aware of pharmacy trend then they were even a few years ago. Pharmacy benefits now represent a significant and growing share of health plan costs.
Advisors are fielding more questions about transparency, oversight, and fiduciary responsibility. That broader environment makes this moment more consequential than a single enforcement action might suggest.
Questions Employers Should Be Asking
Events like this tend to prompt internal review, which is healthy.
Employers may want to revisit how their formularies are constructed and whether financial incentives influence drug placement. They may want to confirm that rebates are fully passed through and that spread pricing is eliminated. It is also worth examining where revenue is generated across specialty, mail order, and affiliated entities.
None of these questions are accusatory. They are part of responsible plan governance. Increased scrutiny raises the standard for understanding how pharmacy contracts operate.
Where the Fiduciary Model Differs
The concerns highlighted in the settlement revolve around incentive structure. When revenue depends on higher list prices, rebate retention, or dispensing spreads, employers may be exposed to costs that are not immediately transparent.
US-Rx was built with the future of accountability in mind.
Our compensation is not tied to drug list prices. We do not engage in spread pricing, and rebates are passed through in full. Revenue is structured to align with reducing total pharmacy spend for plan sponsors rather than benefiting from higher prices. You can learn more about our fiduciary pharmacy model here.
The economic structure is independent of manufacturer rebate magnitude and dispensing spreads; clients are insulated from many of the conflicts that have drawn regulatory attention.
Looking Ahead
The Express Scripts settlement will not resolve every rebate surrounding PBM practices. It does, however, bring incentive alignment into sharper focus for regulators, employers, and advisors. For plan sponsors, this is an opportunity to examine pharmacy relationships with a more detailed understanding of how revenue flows through the system. For advisors, it reinforces the importance of recommending models built on structural alignment rather than rebate maximization.
At US-Rx, we will continue to monitor these developments carefully and contribute to the broader industry discussion. Pharmacy benefits represent too significant a component of healthcare spend for incentive design to remain secondary.